New pricing mechanism set for ADNOC’s Murban crude

Created: Thursday, 07 November 2019 08:33

Abu Dhabi’s Supreme Petroleum Council (SPC) has launched a new pricing mechanism for the Abu Dhabi National Oil Company’s (ADNOC) flagship onshore crude oil, Murban, at a meeting held at ADNOC’s headquarters

The SPC, Abu Dhabi’s highest governing body for the oil and gas industry, the meeting was presided over by Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and deputy supreme commander of the UAE Armed Forces, and vice-chairman of the SPC.

ADNOC’s CEO Sultan al-Jaber said, “The forward-looking decision to list Murban on an internationally recognised exchange and improve the terms of sale of ADNOC’s Murban Crude, is another significant step in our transformation.”

“The initiative will enable our customers and other market participants to better price, manage and trade their purchases of Murban.”

In the coming months, ADNOC will engage with its customers and other stakeholders on the implementation of its new Murban Crude forward pricing mechanism, which will see it move from a retroactive official selling price (OSP) to a market-driven, transparent, forward-looking pricing. The company expects to apply its new Murban Crude forward pricing mechanism between the Q2 and Q3 of 2020.

The SPC also announced a significant increase in oil and gas reserves and new discoveries of unconventional recoverable gas resources totalling 160 TSCF; a first for the region, opening up a new era of unconventional large-scale hydrocarbon resource development.

The boost would bring the UAE to sixth place in the global ranking of oil and gas reserves, with 105bn bbl of recoverable oil stock and 273 tscf of conventional gas.

Al Jaber said, “We are very pleased and honoured to have enabled the UAE to move from the seventh to the sixth-largest oil and gas reserves in both global rankings. These achievements underscore ADNOC’s drive to ensure we remain a trusted, reliable and responsible supplier of energy to the world for decades to come.”

“Crucially, the discovery of substantial unconventional recoverable gas resources, for the first time, marks an important milestone in the development of the UAE’s unconventional resources as we execute our integrated gas strategy,” he added.